An Analysis of India--China Trade As a Case Study for H-O Theorem (Case Study‪)‬

Abstract This study looks at different factors to help explain why India's growth in total trade has been unimpressive relative to China's total trade output over the past twenty years since trade reforms began in both countries. A comparative analysis of both countries examines factors such as trade tariffs, labor laws, labor flexibility and labor productivity to understand whether India's meager contribution to global trade has been in conflict with H-O Theorem's proposition that even if the technology of production of a good is exactly the same across countries then gains from trade can still be realized due to factor abundance and factor intensities. The main findings of this paper are that: